Regional characteristics and the decision to innovate in a developing country: A multilevel analysis of Ecuadorian firms

Abstract

This is the first study that uses multilevel modelling to analyse regional influence on the decision to invest in innovation activities of firms in a single developing country, Ecuador. Our results indicate that the decision to invest in R&D and in other innovation activities are conditioned by the region in which the firm is located. Regional loan volume, orientation towards knowledge exploitation and intra-regional-sectorial R&D spillovers are positively associated with both types of innovation activities, while regional levels of co-operation and inter-regional R&D spillovers are only positively associated with the probability of investing in other innovation activities.